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 Some 86 percent of people using payday loans have spent more
time alone than normal because they are stressed or depressed
about repaying debts, according to a survey by the Royal Society
for Public Health (RSPH) presented to lawmakers on Wednesday.
Sheen, famous for his roles in the "Twilight Saga" series of
vampire films as well as Oscar nominated "Frost/Nixon", on
Tuesday launched a campaign involving politicians and charities
aimed at helping the more than 1.4 million people in Britain who
use high-cost credit to pay off household debts.
Sheen said speaking to heavily indebted people in his home town
of Port Talbot in South Wales had inspired him to tackle the
problem.
"I've spoken to many people struggling with household debts,
it's clear things are not moving in a pleasant direction and
with wages being squeezed and benefits cut something needs to be
done," Sheen told Reuters in an interview in London.
The high-cost or subprime lending industry, covering small
personal loans all the way up to mortgage lending, flourished in
the run-up to the 2008 financial crisis.
After all but disappearing in the aftermath, the demand they
left behind was met by so-called payday lenders such as Wonga,
which drew heavy criticism for interest rates as high as nearly
6,000 percent on short-term loans.
Those lenders retreated after Britain's financial watchdog put a
cap on what borrowers have to pay back, but in recent years
falling wages relative to inflation and budget cuts in social
support have pushed an increasing number of people back into the
arms of costly lenders.
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In Britain today there is 242 billion pounds ($340 billion)of
consumer debt, a number that has increased by 34.5 percent since
2012 and that is 6 percent higher than the previous peak in 2008,
according to the RSPH report.
The problem is not unique to Britain, Sheen said, and he hopes the
campaign could ultimately be extended to other countries where
people are trapped in the cycle of paying off expensive loans with
even more high cost borrowing.
Sheen said his new 'End High Cost Credit Alliance' will focus on
promoting firms that offer more affordable loans and has already
signed up 50 organizations and individuals including former Labour
party leader Ed Miliband, debt charities and alternative lenders.
"I have heard about people hiding inside their homes when the
doorbell rings because they're afraid about their debts ... we have
to curb high cost credit and replace it with an alternative that's
more responsible," Sheen said.
($1 = 0.7107 pounds)
(Reporting By Lawrence White, editing by David Evans)
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